Qantas lodges IASC application for South Africa.
The International Air Services Commission has just released details of a new Qantas application including a request that South African Airways be allowed to codeshare on QF’s Johannesburg flights until 31 Mar 2016.
It’s the next stage in the long-running saga which has seen the IASC decline to renew the current codeshare allocations past 31 Dec this year; a subsequent legal action by Qantas for a Judicial Review of the decision was withdrawn in May.
Currently Qantas has seven frequencies per week allocated in each direction between Australia and South Africa, and the application is for a new determination for the same level of traffic with a condition which would permit the SAA codeshare.
The new submission seeks to address a number of concerns raised by the Commission in its Feb 2012 decision to not renew the determinations, including public benefits, key characteristics of the route and the likely outcome if the pact is not authorised.
In particular the QF submission highlights provisions of the IASC Policy Statement which says that the Commission “would generally be expected to authorise applications for use of capacity to code share” and that if it has serious concerns it may apply a more detailed assessment – but only after after consulting with the Australian Competition and Consumer Commission.
Sections of the submission are confidential, but provide a detailed breakdown of the profitability of the current block space allocation and how each carrier pays the other for each flight.
“Maintaining the Codeshare Agreement is important to Qantas and, we believe, to SAA. In the current uncertain economic and aviation environment, unwinding the code share on this route will not be conducive to developing the market and optimising capacity levels for the travelling public,” the submission states.
It says it’s considered extremely unlikely that a new airline will enter the route with direct services because of its “intrinsic structural challenges,” while the current QF/SAA codeshare provides “significant public benefits” by enabling direct daily services and benefits for business passengers.
The submission also claims that indirect competitors such as Singapore Airlines, Thai Airways, Cathay Pacific, Emirates, Etihad and Qatar Airways are a “real constraint on the route”.
More information in today’s Travel Daily.